BoCC Approves Incentives To Bring Morinaga To Mebane

CHAPEL HILL- Masao Hoshino, President of Morinaga America, Inc., told Orange County Commissioners on Tuesday that state and local economic incentives played a significant role in the Japanese company’s decision to build its first American production facility in Mebane.

“We decided to locate in Mebane, Orange County because it has a remarkable business environment: access to transportation, access to raw materials, infrastructure, et cetera,” said Hoshino. “Additional encouragement is the incentives. It obviously supported our decision.”

By a unanimous vote, the Board of Commissioners agreed to offer Morinaga performance-based incentives including a $1 million dollar grant to be paid out over the next five years. The grant money would represent three-quarters of the annual tax value of the $34 million dollar facility.

In addition to investment from Orange County and the City of Mebane, the state will contribute slightly more than $1 million dollars to the project.

Located just outside of Mebane, the 21 acre site, which up until recently was used to grow soybeans, lacks water, sewer or direct road access. The county will partner with the state to cover the cost of extending water and sewer infrastructure, which could total $700,000. The state will pay 75 percent of that; the county will pay 25 percent.

NC DOT will chip in half a million dollars to build a road to access the plant, and Durham Technical Community College will offer training to new workers at no charge.

The nearly 100,000 square foot production facility is slated to employ 90 people in the production of Hi-Chew candy. Hoshino told the board it will be a green facility.

“At the planned facility we will cook sugar and syrup, add fruit juice, vegetable oil and other ingredients to make chewy candy,” said Hoshino. “In the process, we do not produce harmful materials, there is no chemical pollution. It is environmentally-friendly.”

Board Chair Barry Jacobs said this project represents the culmination of 20 years of planning to bring new businesses to the 400 acre Buckhorn Economic Development District.

“We have just started as a county to embark of the course of providing incentives to companies to either stay here or locate here,” said Jacobs. “This has been a very amicable and collaborative process and we feel it will be a very fruitful process for everyone concerned.”

He also thanked Orange County voters for approving the quarter-cent sales tax, as proceeds from that will likely be used to cover some of the cost to extend water and sewer to the plant.

The board also unanimously approved a $140,000 contract to hire an engineering firm to design the road, water and sewer extensions. Planners estimate the facility could open for business in July of 2015.

OC Leaders Say Benefits Of Landing Morinaga Will Be “Significant”

ORANGE COUNTY – County Commissioner Penny Rich says that at least three companies have expressed interest in relocating to Orange County since Morinaga, the top-selling Japanese candy company, announced plans to build a new $48 million dollar facility in Mebane.

Rich says it is too early to reveal details about the other companies who have taken notice of Orange County since Morinaga’s announcement, but she anticipates that the economic benefits of landing the internationally-known confectionery will be significant.

“We know that interest grows. When you do make such a huge advantage with a company in one area, other companies take notice,” Rich says.

Morinaga plans to build its first American manufacturing facility in Orange County’s Buckhorn Economic Development District that will employ at least 90 people, and pay an average salary of $38,000 a year.

County Manager Frank Clifton said in a recent board that if the Morinaga facility develops as planned it could become one of the top three taxpayers in the county.

The site is set to open mid-2015, but before construction can begin, the County Commissioners must fulfill the promised incentives package which includes installing water and sewer infrastructure. Rich says that when companies investigate an area, they want to make sure that those utilities are in place before making a deal.

“We know that we have foreign companies that were interested, but we also have domestic companies that were looking elsewhere because of the infrastructure that was not in place in Orange,” Rich says. “Now that the infrastructure is in place, they are taking a second look at our area. It really is exciting.”

Steve Brantley, Orange County’s Economic Development Director, led the effort to recruit the manufacturer. Brantley, who speaks Japanese, says the County beat out 18 sites in the state and other cities, such as Toronto, Canada, and Portland, Oregon.

“The Morinaga name is maybe not so well known by Americans as it would be to Japanese people or people from the Far East,” Brantley says. “They would know Morinaga like we would know Nestle or Hershey.”

Areas surrounding Orange County, like Alamance and Durham Counties, are already home to international companies. Brantley says bringing in a well-known corporate identity such as Morinaga will increase Orange County’s international presence. He says that there is also the possibility for a supplier company to move to the County as well.

“To be selected by an international firm and a very demanding Japanese firm is that if you are meeting their standards, it means that you are doing things right as a community and a county to attract business,” Brantley says.

Rich says she hopes local businesses will also benefit from the large-scale operation.

“If there’s uniforms involved, someone has to dry clean the uniforms,” Rich says. “If there’s advertising that has to happen locally, we would hope that they would use some local advertisers.”

Barry Jacobs, Chair of the Orange County Commissioners, says that bringing in Morinaga kept AKG of America, a German Company, from moving away from Mebane.

BOCC Eyes Incentive Deal For Candy Maker Morinaga

HILLSBOROUGH- Orange County officials have been negotiating in secret for months to bring a major candy manufacturer to the Mebane area. At Thursday’s meeting of the board of commissioners the public got a first look at the incentive package offered to sweeten the deal.

“We had to find a way to be competitive, to make our site draw them here,” said Economic Development Director Steve Brantley. “They very much liked the idea of living in Orange County. They particularly told me that the [company] president likes the diversity. But that was not enough. We had to do more.”

Morinaga & Company announced this week it would invest $48 million to build a manufacturing facility in Orange County’s Buckhorn Economic Development District. The facility will employ at least 90 people, paying average salaries of $38,000 a year.

And though local leaders are seemingly thrilled to have landed the deal, the package of incentives that helped attract the company will have to be formally approved by the board of commissioners following a public hearing this fall.

To that end, Brantley laid out the details of an incentive package that had previously been kept tightly under wraps. He stressed the money will not come out of the county’s general fund, but will come out of the property taxes on the new facility instead.

“It’s based upon the investment by the company,” said Brantley. “We have proposed 75 percent of the estimated taxes of the project’s capital investment for up to five years, so if for example the company made a $48 million dollar investment, it would receive approximately $308,000 annually in a performance grant for each of five years.”

Brantley added there will be a claw-back provision for the county to recoup the money should the company fail to meet its growth goals.

The City of Mebane is also considering an incentive package, and the N.C. Department of Commerce will offer a quarter million dollar grant from the One North Carolina Fund.

The 20 acre Buckhorn site is currently undeveloped, lacking water, sewer, electricity and road access. Brantley said all these will be put in place at no charge to Morinaga, as North Carolina and Orange County will share the cost.

“We are highly confident that the state of North Carolina has pre-qualified this project as eligible to apply for and receive a Community Development Block Grant and it will reimburse Orange County for 75 percent of our initial costs to front the water and sewer extensions to the site,” said Brantley.

Water and sewer infrastructure are estimated to cost about $675,000, some of which could come from the county’s quarter-cent sales tax.

In addition, the N.C. Department of Transportation has offered half a million dollars to provide road access to the site, and gas and electricity will be extended to the building free of charge by PSNC Energy and Progress Duke Energy.

County Manager Frank Clifton told the board that if the Morinaga facility develops as planned it could become one of the top three taxpayers in the county. More importantly, he said this project could spark renewed interested in Orange County’s economic development districts.

“This is only 20 acres out of roughly 700 that have been rezoned by this county commission for economic development purposes in the Buckhorn area,” said Clifton. “Twenty acres has the potential to produce roughly $100 million dollars of asset valuation for Orange County. That’s a significant impact and it offers us great opportunities for the future. It is a big deal in Orange County.”

The public hearing on the incentive package will likely be held in October. If all parties approve the deal, Morinaga could host a ground-breaking ceremony as early as next March.

Japanese Candy Co. To Open Operations In OC

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CHAPEL HILL – A top-selling Japanese candy company announced plans Tuesday to build a new facility in Mebane, creating 90 new jobs and investing $48 million over the next three years.

Barry Jacobs, Chair of the Orange County Commissioners, says it is a sweet deal for the area in more ways than one.

“It will not only give a boost in becoming a large employer in Orange County, but we hope it will also help to stimulate other companies that would like to locate and identify with a quality, international company,” Jacobs says.

Morinaga and Company, the top-selling candy manufacturer in Japan, was founded in 1899 in Tokyo. It produces a wide variety of confectioneries, including chocolates, cookies, and frozen desserts. Its products became available in the U.S. five years ago.

The company’s subsidiary operations in Mebane will consist of blending syrup, sugar, flavorings and other ingredients to produce soft candy, the Associated Press reports. The site, set to open mid-2015 in the Buckhorn Economic Development District, is the firm’s first American manufacturing enterprise.

The Orange County Economic Development Department, led by director Steve Brantley, fronted the efforts to recruit the manufacturer. To land the project, Orange County survived five rounds of visits from Morinaga consultants since the county first tried to attract the company in February 2012.

“We beat out 18 sites in approximately 12 North Carolina counties,” Brantley says “Other places outside the state that has been considered seriously included Toronto, Canada, Richmond, Philadelphia, Atlanta, and even Portland, Oregon.”

Brantley says Morinaga ultimately choose the Mebane site, near the Tanger Outlet mall, because of interstate visibility, a high confidence in the area’s work force, and the presence of UNC and Durham Tech, which will handle the critical training for the company.

Contingencies before the project can be finalized and construction begun include road accessibility, a supply of electricity and natural gas, and water and sewer extensions. Those improvements are planned to be funded by city, county and state performance grants.

Several other factors, Jacobs explains, played a key in making the project possible, including the rezoning of the district.

“Two years ago, the county made decisions to rezone it, and last year, the County Commissioners made decisions to rezone it, hoping that we would land a corporate client and it worked,” Jacobs says.

The 120,000 square-foot facility will offer health and retirement benefits for Morinaga employees. These jobs will be created over three years, offering competitive salaries, averaging more than $38,000 a year, according to a statement issued by Orange County.

“We’re trying in several different ways to use areas that we have previously zoned for economic development to provide more jobs and keep our non-residential tax base growing,” Jacobs says.

Jacobs also cites the use of the quarter-cent sales tax for funding economic development incentives.

“We owe a debt of gratitude to the voters who voted for the quarter-cent sales tax a few years back because half of that quarter-cent goes toward economic development,” Jacobs says. “The largest percentage goes to providing infrastructure, in this case water and sewer, for our economic development district.”

Jacobs says the company will be in the top ten employers for the County.